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Tuesday, 10 September 13
WORLDWIDE COAL CONSUMPTION RISES SHARPLY - RA DR. ERICH SCHMITZ
 By: RA Dr. Erich Schmitz, Verein der Kohlenimporteure (Germany Coal Importers Association)
World hard coal market in the first half of 2013: worldwide production and world trade stagnating, imports to Europe and Germany rise in HY1 2013 despite the massive expansion in renewable energies.
Energy consumption worldwide increases only slightly – in contrast, coal consumption rises sharply.
According to initial calculations by BP in the Statistical Review of World Energy, June 2013, world energy consumption in 2012 experienced a below-average rise of 358m TCE to 17.8bn TCE (about 2%) in comparison with 2011; initial estimates of the World Energy Council for 2012 show a rise of 420m TCE (2.20%) to 19.1bn TCE, taking renewable energies into account. This modest growth is a consequence of the global economic stagnation which has had an impact on the OECD region above all.
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The Asian-Pacific region, where the increase was 4.70%, continues to be a region of growth in primary energy. Worldwide oil consumption of 4,130m tonnes rose only slightly (+1.20%). For the fifth year in succession, the EU 27 countries and the USA reduced their consumption of primary energy, by just under 1% and 2.50%, respectively. Russia ’s energy consumption , on the other hand, remained virtually unchanged.
The rise in the world consumption of primary energy is largely a consequence of the increase in hard coal consumption by about 3.30% and in gas consumption by 2.40% related to the shale gas boom in the USA. In view of the slower economic growth in China, India and other South-east Asian countries and a recession in many OECD countries, the VDKi expects stagnation in primary energy consumption and consequently in coal consumption as well for 2013.
China especially will play a key role here because this country accounts for more than 50% of worldwide coal consumption and worldwide coal production. According to data from the national coal association in China, the consumption of steam and coking coal in HY1 2013 in China amounted to 1.93bn tonnes, corresponding to an increase of only 1% in comparison with 2012, but 7.60% less than during the comparable period of 2011.
On the other hand, production of 1.79bn tonnes during the first six months represented a decline by 3.7% in comparison with HY1 2012. Presumably the high inventories, which according to newspaper reports still amounted in all of China to about 300m tonnes at the end of June, have been reduced.
Seaborne hard coal trade (steam coal only) continues at the level of the previous year (410m tonnes) according to calculations of the VDKi. However, there have been shifts among the exporting nations: Indonesia (+26m tonnes) and Australia (over +10m tonnes) have increased their exports while Colombia (-5m tonnes owing to strikes and logistic restrictions at the beginning of the year), South Africa (almost -3m tonnes) and Russia (-1m tonnes) have exported less steam coal.
The background for the rise in exports from Indonesia and Australia could be China’s announcement that it will in the future prohibit the import of hard coal of lower quality (calorific values, sulphur or ash content) from Indonesia and Australia in particular. This may have led to early deliveries in fulfillment of contractual purchase obligations in existing contracts. According to data from IHS McCloskey Coal Report, China imported about 15m tonnes more coal (hard coal and lignite) during HY1 than in 2012.
Europe and Germany
A slight, but steady, increase in coal consumption in the European Union, especially in the United Kingdom, France and Spain, has been observed in the last two years. Declining hard coal output in Germany, Spain and Poland is being compensated by increased imports.
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The long winter in Europe and the favorable clean dark spread (costs for coal, freight and CO2 certificates), which has been lower in comparison with the clean spark spread (costs for gas, transport and CO2 certificates) for some time, encourage coal-fired power generation in Europe. The electricity is frequently exported to countries strongly dependent on gas such as the United Kingdom or Holland.
According to a report on the European electricity market in Q2 2013 from the EU Commission, the electricity prices for the base load in Q2 fell significantly (weighted for volume , from € 46/MW h in March 2013 to €30/MW h in June 2013 ).
Since coal prices continued to fall as well and the CO2 prices remained low, this meant, according to data from the DG Energy of the EU Commission, that the share of solid fuels for power generation exceeded 50%, which is a higher figure than that of 2012 (45 %). However, the clean dark spread decline d to €4 /MW h; in the two previous quarters, it had still been in the two-digit range. All of this took place against the backdrop of the rising share of renewable energies; production from these sources was high in Q2 and, according to data from the EU, led for instance to negative power prices below -€100 /MW h in Germany and Belgium an d be low -€ 200 /MW h in France on 16 June of this year.
Power generation from gas-fired power plants consequently declined sharply as well because the high gas prices make it unprofitable. EU data show that the clean spark spread fell to below -€19.50 /MW h.
Hard coal imports to Germany rose by 3.4m tonnes (15%) to 25.7m tonnes in the first six months. Extrapolated for all of 2013, this would mean that for the first time since 1957 more than 50m tonnes of hard coal would be imported to Germany. The managing director of the Coal Importer Association, Dr Erich Schmitz, commented on this development: “Of course we would be absolutely delighted by such a high volume of coal imports. However, we must not allow ourselves to be misled about two essential points:
1. The decline in German hard coal mining is making itself felt more and more strongly because it is being compensated by increased imports.
2. If the low electricity wholesale prices resulting from the non-competitive inclusion of the priority feed-in of renewable energies, especially from solar parks, continue, they will constitute a massive threat to the economic existence of hard coal-fired power plants. They can no longer market their electricity profitably on the German market at these prices and profit solely from the export of electricity to countries dominated by power generation from gas-fire d power plants."
This has led the VDKi to affirm its call for a fundamental reform of the compensation for power from renewable sources and for a capacity market for new and existing power plants of all kinds, oriented to a free market and non-discriminatory, immediately after the national election in Germany.
“Otherwise, ” notes Schmitz, “there will be a flood of notifications of shut-downs of older coal- and gas-fired power plants to the Federal Network Agency which could result in a substantial risk for the security of power supply in Germany in 1 to 2 years.”
-Power generation from hard coal-fired power plants in Germany rose by an estimated 5 TWh to about 65 TWh.
-According to data from the AGEB, hard coal consumption for power generation rose by 8.5% to 21.8 million TCE.
-According to data from the AGEB, gross power export rose by 8.4% in comparison with the same period of the previous year to 35.96 TWh; less imports, there is still an export surplus of 15.4 TWh, generated primarily in hard coal-fired power plants.
Source: Verein der Kohlenimporteure (Germany Coal Importers Association)
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Thursday, 25 January 24
THE RED SEA ESCALATION IMPLICATIONS ON GLOBAL SEABORNE TRADE - MARIA BERTZELETOU
In recent days, discussions have intensified about the potential impact on the seaborne trade and ton-miles due to the evolving dynamics of market ...
Thursday, 25 January 24
RED SEA SHIPPING DISRUPTIONS KEEP GEOPOLITICAL PREMIUM FOR COMMODITIES - FITCH RATINGS
Shipping disruptions and re-routing away from the Red Sea will maintain the geopolitical premium in the main commodity markets, including for oil a ...
Friday, 19 January 24
INDONESIA TARGETS 710 MLN METRIC TONS COAL OUTPUT IN 2024 AFTER RECORD 2023 - REUTERS
Indonesia, a major thermal coal exporter, aims to produce 710 million metric tons of coal in 2024, its mining minister said on Monday, after postin ...
Friday, 19 January 24
DRUMMOND COLOMBIA COAL OUTPUT ROSE 7.1% IN 2023 - REUTERS
Coal production from miner Drummond’s Colombia operations rose 7.1% in 2023 to 29.5 million metric tons, while exports declined by 2.6% to 27 ...
Friday, 19 January 24
CHINA'S 2023 COAL OUTPUT HITS RECORD HIGH - REUTERS
China’s coal output reached a record high in 2023, data from the statistics bureau showed on Wednesday, amid an ongoing focus on energy secur ...
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- Pendopo Energi Batubara - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Rio Tinto Coal - Australia
- Bhatia International Limited - India
- OPG Power Generation Pvt Ltd - India
- Grasim Industreis Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Samtan Co., Ltd - South Korea
- Bahari Cakrawala Sebuku - Indonesia
- Meenaskhi Energy Private Limited - India
- Sojitz Corporation - Japan
- ICICI Bank Limited - India
- Miang Besar Coal Terminal - Indonesia
- India Bulls Power Limited - India
- Bayan Resources Tbk. - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Mintek Dendrill Indonesia
- Dalmia Cement Bharat India
- Makarim & Taira - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- ASAPP Information Group - India
- Petron Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Karaikal Port Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- Price Waterhouse Coopers - Russia
- Indika Energy - Indonesia
- Bulk Trading Sa - Switzerland
- Bhoruka Overseas - Indonesia
- South Luzon Thermal Energy Corporation
- Maheswari Brothers Coal Limited - India
- Larsen & Toubro Limited - India
- Leighton Contractors Pty Ltd - Australia
- Krishnapatnam Port Company Ltd. - India
- Sinarmas Energy and Mining - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Indonesian Coal Mining Association
- MS Steel International - UAE
- Minerals Council of Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Wood Mackenzie - Singapore
- Barasentosa Lestari - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Carbofer General Trading SA - India
- Australian Coal Association
- Sakthi Sugars Limited - India
- Commonwealth Bank - Australia
- Directorate General of MIneral and Coal - Indonesia
- Directorate Of Revenue Intelligence - India
- Mercator Lines Limited - India
- Aboitiz Power Corporation - Philippines
- Port Waratah Coal Services - Australia
- Energy Development Corp, Philippines
- SMG Consultants - Indonesia
- Kumho Petrochemical, South Korea
- Cement Manufacturers Association - India
- Kapuas Tunggal Persada - Indonesia
- Therma Luzon, Inc, Philippines
- Iligan Light & Power Inc, Philippines
- Agrawal Coal Company - India
- McConnell Dowell - Australia
- Baramulti Group, Indonesia
- Ministry of Mines - Canada
- Romanian Commodities Exchange
- AsiaOL BioFuels Corp., Philippines
- Banpu Public Company Limited - Thailand
- International Coal Ventures Pvt Ltd - India
- IEA Clean Coal Centre - UK
- Semirara Mining and Power Corporation, Philippines
- Alfred C Toepfer International GmbH - Germany
- Global Green Power PLC Corporation, Philippines
- IHS Mccloskey Coal Group - USA
- Madhucon Powers Ltd - India
- Planning Commission, India
- Thai Mozambique Logistica
- Ministry of Transport, Egypt
- Tamil Nadu electricity Board
- Semirara Mining Corp, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Indo Tambangraya Megah - Indonesia
- Australian Commodity Traders Exchange
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kobexindo Tractors - Indoneisa
- Mercuria Energy - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Essar Steel Hazira Ltd - India
- Parry Sugars Refinery, India
- Trasteel International SA, Italy
- Singapore Mercantile Exchange
- Bukit Asam (Persero) Tbk - Indonesia
- Latin American Coal - Colombia
- Sical Logistics Limited - India
- Ceylon Electricity Board - Sri Lanka
- Coastal Gujarat Power Limited - India
- Intertek Mineral Services - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Kideco Jaya Agung - Indonesia
- Siam City Cement - Thailand
- Deloitte Consulting - India
- Straits Asia Resources Limited - Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Savvy Resources Ltd - HongKong
- Binh Thuan Hamico - Vietnam
- Global Coal Blending Company Limited - Australia
- Power Finance Corporation Ltd., India
- Bhushan Steel Limited - India
- Bukit Baiduri Energy - Indonesia
- Electricity Authority, New Zealand
- Meralco Power Generation, Philippines
- Marubeni Corporation - India
- Posco Energy - South Korea
- Central Electricity Authority - India
- Ambuja Cements Ltd - India
- Vizag Seaport Private Limited - India
- White Energy Company Limited
- Attock Cement Pakistan Limited
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Interocean Group of Companies - India
- Kepco SPC Power Corporation, Philippines
- Eastern Energy - Thailand
- Ministry of Finance - Indonesia
- Metalloyd Limited - United Kingdom
- Medco Energi Mining Internasional
- Xindia Steels Limited - India
- Mjunction Services Limited - India
- GAC Shipping (India) Pvt Ltd
- The State Trading Corporation of India Ltd
- Chettinad Cement Corporation Ltd - India
- SMC Global Power, Philippines
- Parliament of New Zealand
- The University of Queensland
- CIMB Investment Bank - Malaysia
- Standard Chartered Bank - UAE
- PowerSource Philippines DevCo
- Renaissance Capital - South Africa
- Sree Jayajothi Cements Limited - India
- SN Aboitiz Power Inc, Philippines
- Vedanta Resources Plc - India
- PNOC Exploration Corporation - Philippines
- Gujarat Sidhee Cement - India
- Electricity Generating Authority of Thailand
- Pipit Mutiara Jaya. PT, Indonesia
- Kaltim Prima Coal - Indonesia
- Anglo American - United Kingdom
- Simpson Spence & Young - Indonesia
- Bharathi Cement Corporation - India
- Heidelberg Cement - Germany
- Gujarat Electricity Regulatory Commission - India
- Independent Power Producers Association of India
- Toyota Tsusho Corporation, Japan
- Bangladesh Power Developement Board
- European Bulk Services B.V. - Netherlands
- Holcim Trading Pte Ltd - Singapore
- TeaM Sual Corporation - Philippines
- GMR Energy Limited - India
- Thiess Contractors Indonesia
- Economic Council, Georgia
- Global Business Power Corporation, Philippines
- Orica Australia Pty. Ltd.
- Indian Energy Exchange, India
- Aditya Birla Group - India
- Indogreen Group - Indonesia
- Wilmar Investment Holdings
- Siam City Cement PLC, Thailand
- Videocon Industries ltd - India
- Sarangani Energy Corporation, Philippines
- VISA Power Limited - India
- Rashtriya Ispat Nigam Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Kartika Selabumi Mining - Indonesia
- Energy Link Ltd, New Zealand
- Edison Trading Spa - Italy
- Central Java Power - Indonesia
- Tata Chemicals Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Goldman Sachs - Singapore
- Coal and Oil Company - UAE
- Oldendorff Carriers - Singapore
- Karbindo Abesyapradhi - Indoneisa
- Salva Resources Pvt Ltd - India
- Georgia Ports Authority, United States
- Uttam Galva Steels Limited - India
- Timah Investasi Mineral - Indoneisa
- Jindal Steel & Power Ltd - India
- San Jose City I Power Corp, Philippines
- Globalindo Alam Lestari - Indonesia
- Star Paper Mills Limited - India
- Cigading International Bulk Terminal - Indonesia
- Borneo Indobara - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- PTC India Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Africa Commodities Group - South Africa
- Sindya Power Generating Company Private Ltd
- LBH Netherlands Bv - Netherlands
- Lanco Infratech Ltd - India
- London Commodity Brokers - England
- Eastern Coal Council - USA
- Antam Resourcindo - Indonesia
- GVK Power & Infra Limited - India
- Orica Mining Services - Indonesia
- Chamber of Mines of South Africa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Formosa Plastics Group - Taiwan
- Manunggal Multi Energi - Indonesia
- CNBM International Corporation - China
- Indian Oil Corporation Limited
- Bukit Makmur.PT - Indonesia
- Altura Mining Limited, Indonesia
- Coalindo Energy - Indonesia
- Riau Bara Harum - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Ind-Barath Power Infra Limited - India
- New Zealand Coal & Carbon
- Merrill Lynch Commodities Europe
- The Treasury - Australian Government
- Malabar Cements Ltd - India
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